Curiously enough, I have just (20 June 2017) used exactly the same wording as that suggested by Grimalkins, and it has been accepted. – The idea of a sentence with no subject expressed is very disconcerting for English-speakers, and I feel we should have been given a more explicit warning about this kind of construction.

Maybe "Over here you can smoke" would be an acceptable translation? I know there is no use of the word "you", but this doesn't make sense in English otherwise. "One can smoke over here" seems to be an odd answer reading back as an English person, it makes grammatical sense, but the use of the term "One" seems out of context for the Russian displayed. Just thought I'd raise this as it feels slightly wrong for me.

from what i understand, 'можно' can be translated pretty much as 'one may' and is used when you are talking about possibility/ability to do a thing without addressing a particular person or group of people.